The homebuilders segment is seeing some excitement at this time of the year, when there is a lull in the markets overall.
With online stock trading, it is important to identify the way the stock market behaves at various periods of the year. Often, decisions are influenced by that. And expert opinion helps too.
At this time of the year, when the summertime lull has kind of set in at the stock markets, experts at InvestorPlace Media have identified a segment of the industry where there is real excitement – the homebuilders sector.
SPDR S&P Homebuilders ETF
For ETF trading, one chief consideration is the SPDR S&P Homebuilders ETF (NYSEARCA: XHB). This has risen to levels unseen from early December 2015. Sales in July rose to a 654k annualized rate which is higher than the 580k that was expected. This translates to a 12.4% rise which pushed the index to levels unforeseen since October 2007. The inventory has tightened, which is a suggestion that there are higher prices that could be coming. There is fresh buying in the homebuilding stocks, with the big names in the industry getting set to break out of consolidation ranges extending for many months.
Moving on to homebuilders stocks, Toll Brothers Inc (NYSE: TOL) is worth watching. This is a luxury homebuilder which, for the first time after December, is rising ahead of its 200-day moving average following its fourth straight quarter in which revenues have improved. Earnings were 61 cents, which is a 70% year-over-year improvement and matching Wall Street consensus. Revenues had a 24% increase to $1.27 billion which just about exceeded expectations. There was an 18% increase in net signed contracts too. With its fiscal Q4 results expected to be reported before the bell on November 22, analysts are expecting earnings in the region of $1.09 per share on revenues worth $1.7 billion.
Shares of the PulteGroup, Inc (NYSE: PHM) are resisting their highs in late July that stood near $22.50, which is a level of resistance dating back to spring 2013. With the 2007-08 housing bust worries fading, Deutsche Bank analysts upgraded the stock to buy as the Group’s management showed renewed focus on growth. $PHM’s results were better-than-expected on July 21. The value of new, rising orders stood at 11%.The company’s $3.1 billion backlog has been the highest ever innine years. Its 28 cents-per-share earnings overcame expectations by 2 cents.
However, its $1.28 billion revenue was half-percent off and below expectations. The company’s next earnings report is expected on October 20, with analysts expecting 43 cents per share on $1.9 billion worth revenues. That’s an improvement of 28%.
With a deeper and expert look into the markets, online stock trading becomes a lot more scientific and intellectual. It’s always important to understand the times.
Trade these ETFs and all others listed in the US markets for free with TradeZero. Demo the ZeroPro and ZeroWeb trading platform for free for a week.